If you’re a first time buyer on a limited budget, Montreal is a great place to start your property search. The average Montreal condo cost $292,000 in 2017, compared to the average cost of $529,782 in Toronto and $682,800 in Vancouver. While property prices may be elevated in select residential boroughs – such as Town of Mount Royal, Old Montreal and Westmount, there are plenty of options first time buyers can choose from in safe and central locations.
To comfortably support a mortgage loan of $247,000 ($250,000 minus a 5% downpayment of $12,500 plus your mortgage insurance of $9500), you would need household earnings of at least $59,940 after tax. Most financial experts recommend that your housing costs (including taxes, amount to no more than 30% of your monthly income. This is also the guideline that lending institutions will use when qualifying you for a loan amount.
- At a 3.14 % interest rate and on a term of 25 years, your monthly mortgage costs will be $1187.
- Your homeowners insurance will be around $50 a month
- Your property taxes will amount to around $369 a month.
- Your utilities will vary, but for a newer construction you can expect around a dollar / square foot / year: around $58
- Your total monthly costs will be around $1665.
- You would need a minimum household earning of $59,940 a year to comfortably qualify for a $250,000 loan.
So what can a first-time homebuyer on a $250,000 budget afford in Montreal?
All figures cited in this article are based on Centris data as of March 8, 2018
In Central Areas: Ville Marie, St Henri, Griffintown, Plateau, Little Italy
Buyers limiting their search to fully developed neighbourhoods in the central core of Montreal will be able to afford a loft or 1 bedroom condo.
For instance, there are 110 condos actively for sale in Downtown Montreal for less than $250,000, while only 17 of them offer 2 full bedrooms.
In Up and Coming Areas: Rosemont, Pointe St Charles, Ville Emard, HOMA
Buyers expanding their search to up-and-coming, yet central, areas will be able to find a 2 bedroom condo, or a 1 bedroom condo with a garage.
In HOMA, there are 143 condos with 2 bedrooms actively listed for under $250,000.
There are 38 condos in the same neighbourhood with 1 bedroom and a garage.
Other affordable areas to consider: Verdun, Lasalle, Lachine NDG/CDN
Earlier this year, we rounded up a list of top Montreal neighbourhoods to invest in. These were all areas with high appreciation rates, quick resale times, and proximity to the Downtown core. Of the list, Verdun, Lachine, Lasalle and NDG / CDN accompany the previously mentioned areas as attractive contenders for first time buyers, as they team affordable real estate prices with strong resale value.
For example, the 20 condos actively listed in Verdun under $250,000 are expected to appreciate at a rate of 8% per year.
What about single family homes?
At a $250,000 price point, buyers seeking a detached home or a bungalow can begin their searches in the following areas:
- Lachine (4 active listings)
- Pierrefonds/Roxboro (4 active listings)
- HOMA (6 active listings)
- Montreal Nord (20 active listings)
- Longueuil (31 active listings)
- RDP / PAT (46 active listings)
- Laval (149 active listings)
Have you tried looking for a BMV property?
A BMV, or Below Market Value Property is a real estate offering that is listed for sale below uts market value, or below its municipal assessment value. There are several places a first time buyer can look to find BMV properties:
- Set up a property alert for repossessions in your preferred neighbourhood. Repossessed homes tend to be listed below market value since they are being sold by the bank, rather than the seller. Note: indicate that you are looking for repossessed properties in the “Additional Criteria” section.
- Request a list of top properties listed below municipal evaluation in Montreal.
- If you think a property might be listed below market value, request a free professional evaluation of the property’s current worth.
- Ask your broker to send you his or her own selection of BMV properties. Many brokers have access to pre-market BMV properties, which are likely to sell even before they are listed online.
- Subscribe to a Deal of the Week mailing list, which will send you the single best BMV property on the market every week by email.
This article, What Can a First Time Homebuyer on a $250,000 Budget Get in Montreal? appeared first on Shupilov Real Estate.